May 07, 2020 • Aaron Goldman

Today let’s turn the lens on television and the converged TV (CTV) space. Here’s what we’re seeing:

People are watching a lot of TV.

With everyone on lockdown, the collective appetite for content is insatiable and we’re craving it on the big screen. Per Statista, broadcast TV is up 20% and streaming is up 27% globally. Radha Subramanyam from ViacomCBS reports that linear TV has gained more than 6 million more viewers in the average minute compared to pre-pandemic levels and streaming has increased by about 4 million viewers. Meanwhile, Hub Entertainment Research pegged the increase in average number of TV services used per viewer at 50% in April. Is it just high-end productions we’re hungry for? Knope! On the day NBC aired the Parks and Recreation reunion, engagement on social media increased 1,322% as compared to the week before the episode was announced.

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Marketing activity varies by sector.

Looking at things from a brand perspective, some industries are holding their TV ad spend steady based on Teletrax ad occurrences tracked via Kinetiq month-over-month in April. Those campaigns reflect consumer categories that have remained constant throughout the pandemic such as Entertainment (up 1%), Health (up 3%), and Consumer Products (down 1%). Meanwhile, verticals that have been harder hit pulled back ad budgets including Restaurants (down 24%), Teleco (down 25%), Auto (down 43%), Retail (down 45%), and Travel (down 84%).

Content and commerce are colliding.

With people confined at home, online shopping has taken on a primary role in consumer behavior. We’re also seeing the lines between content and commerce blur with NBCUniversal Checkout making TV and video shoppable. This is a trend I highlighted in Essence’s report Advertising in 2030 and, while it may be hard to envision the world one year from now much less ten years, it’s clear the future of data and personalization is here today but not widely distributed.

The scaled ecosystems are at a massive advantage.​​​​​

Looking at Facebook’s Q1 earnings, it’s clear the closed ecosystems are faring better than open web publishers during the crisis. As I told Verdict, “With the release of group chats and continued investment in Watch, Facebook is poised to further capture consumer time and attention from the 3 billion people that use its apps each month. Looking ahead, these engaged audiences inside closed ecosystems will be prime for monetisation.”

But it’s not just Facebook that’s gaining ground. And it’s not just the triopoly nor the broader set of digital walled gardens. The major TV players are assembling their ecosystems using a similar playbook of controlled access, engaging native formats, and data-driven advertising. The result is a group of formidable media companies that present new requirements for brands to operate within and across closed ecosystems. This was my talk track on Beet TV as part of the TransUnion series on navigating accelerated change. And of course, it’s in scope for Scope.

There’s no room for additional tech tax.

As many logos across the Display Lumascape jockey for position in the Convergent TV Lumascape, it’s clear that there are fewer categories in play. Indeed, CTV presents a great do-over opportunity for media companies to reduce the points of friction between marketers and people by focusing solely on layers that add value without taxing each impression. This is the POV our CEO, Lance, lays out in his latest AdExchanger byline. By taking the best ingredients of open web programmatic but leaving behind the baggage, a winning formula emerges that will set the tone for TV in the years to come.